The European Central Bank and the Bank of Japan have found out how the blockchain technology can generate new arrangements of the securities settlement, such as «miloshenkova atomic swaps» among unrelated registries.

This is referred to in their joint report, «settlement Systems for securities: DVP in a distributed environment of accounting.»

The report was prepared in the framework of the Stella project, established in partnership between the two Central banks in December 2016 to participate in broader discussions about how to use the blockchain.

It examines how the method of payment of the securities DVP (the principle of cash payments, wherein the cash transfer in one currency occurs simultaneously with the transfer of monetary funds in other currency) the transfer of one asset occurs only if the other asset is transferred. Double transfer is referred to as «atomicity».

Researchers have created prototypes based on platforms Corda, Elements and Hyperledger Fabric, and found that DVP can be performed in the blockchain system, with cash and securities between the individual registries or within a registry.

Experiments and conceptual analysis has demonstrated that international DVP may occur without any connection linking the separate registers. This scenario is not found in the current method, the report noted.

«The exchange of DVP among unrelated registries will require multiple interactions between the buyer and the seller, the report says. The system can also affect the transaction rate, requiring temporary blocking of liquidity. The lack of synchronization in the system may lead to the fact that the participants are exposed to the main risk in the case where one of the counterparties in the transaction does not perform all steps of the process.»